Q: Where are we at, and where are we going and for how long?
To get our compass correct, I have below a 3 year SPY chart, overlayed with Fib Time Zone analysis.
Numbers tend to move in relative consistent time distances from their previous calculated number. This holds true in all the Universe.
Fibonacci Time Zones Defined:
A series of vertical lines that are spaced at the Fibonacci intervals of 1, 2, 3, 5, 8, 13, 21, 34, etc. The first line is placed at an extreme point on the chart and the lines that follow are spaced at increasingly wider intervals in accord with the Fibonacci sequence.
After week 5 low, the market advanced 2 more weeks, before consolidating downward into week 8.
We can see this exact repeat in the 2011 sequence from week 5 to week 8.
In 2011, the exact high, was the exact FIB 21 WEEK. (NASDAQ:COOL)
2009 Week 13 low, is the 4th wave in a 5 wave up pattern. Notice SPY pulled back 3-weeks into 2010 week 13, and the same repeat pattern into 2011 week 13.
The FIB retrace however, was smaller in 2011. (This would be because of the month of November, setting up for Bull Christmas run)
Going forward to my current Fib count, since we have not reached week 13 yet, this implies and gives credence to my estimation noted last week, that we are in a complex wave 3, not working a wave 5 completion of trend. (THIS POINT IS VERY IMPORTANT)
THE REASON this point is SO important to understand is, the next move out of wave 4, will be UP into wave 5 completion and if FIB Intervals hold true, which I believe they will, this WAVE 5 move will be 21 WEEKS in length. (WHICH MEANS U DO NOT WANT TO BE SHORT FOR 21 WEEKS OF A MARKET ADVANCE OR YOUR PORTFOLIO WILL GET KILLED! YES I AM YELLING THIS POINT)
Last week, was down-week 1 is complete. If history repeats we have a move lower coming of 2-3 weeks, into Feb 24th or 1st of March, before embarking on 21 WEEKS OF A BULL RUN to complete the 5th wave and bring in the worst BEAR MARKET any of us have ever seen.
Q: How come you didn't begin this last count at the very top of the range, the last 21 ending day in June? A: Because the Numbers don't line up to any significant turn points. But when I start from the secondary high in July, the FIB weeks line up.
Important--If my count is incorrect, this suggest we have completed week 13 and are working the 21 week leg. If that is the case, then week 13 completed around Christmas, thus week 21 would be in MAY!
I just cant see us rallying from here until may after already moving between 10-45% depending on the index or sector. So, I will stick with for now, we have begun wave 4 pull back; it will be fast and furious and complete quickly.
Q. What is the expected pull back price? A> Retrace minimum is 1/8th or .12. That gets us to 1193, around 1200. Support one on weekly currently is calculated at 1090. I believe somewhere between these two figures. Because of time of year, the pullback can be more extreme.